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Updated almost 6 years ago,
2nd position in gap lending, first time investor need help
I did a gap loan to a wholesaler who has a few projects going on. This is my first time investing. I received a promissory note/ operating agreement. He promises to pay principal and interest at a yearly rate of 12 %. I loaned them 35K. This is my concern, never took this operating agreement /promissory note to a lawyer to review. BIG MISTAKE. I was given no other paper work. (what paper work should I have been requesting)? I drove down to this property which is in a high crime area, not only high crime but serious crimes. The Rehabber did the bear minimum to fix this house. He signed an exclusive with a Realtor and they showed the house a few times but people can't apply for FHA Loan because there is a Gas Station across the street from the house. My question is when being in 2nd position which now I understand is very risky what paper work should I have been given? Can I be put on the deed as second lien holder?
Shouldn't I have been told who hard money lender is? closing cost? etc. I don't know how much ARV is, the first contractor was fired for doing terrible work, a second contractor was hired to finish the job. what is the proper protocol in this situation. I need an attorney I am looking for one. House is located East Orange NJ, Now they are lowing the price of the house 5K . If anyone can suggest to me or help me please I am pacing the floors.